As for all the paranoia over storing personal information in the cloud I have to say, "Just get over it!" As a SysAdmin/Database Administrator for the past 15 years working in software/data warehousing companies all I can say is for the most part all your data is already out there, it is bought, sold and traded everyday. Name, address (every one you ever had), phone numbers, SS #, job history, salary history, what you buy, when and where you eat, medical records, driving habits, computer habits ... blah blah blah.
For a long time I tried to keep all my info offline, but it really is pointless, and what most people actually share is more damaging then their personal info like the pics of you taking bong hits at a frat party 15 years ago.
As for not getting a hard copy of software, get over that one too. Anyone that doesn't have backups of there digital files is asking for a catastrophe. At this point in time everyone should have some sort of backup, whether it be a single drive with a one touch backup or a home NAS system or just a bunch of CDs (really, they cost like $0.25 and every computer made in the last 10 years has a burner). With the amount and size of digital files everyone has these days and the fact that you'll just keep getting more I recommend a home NAS that supports RIAD 5/6 like this one
http://www.newegg.com/Product/Product.aspx?Item=N82E16822122062 with 4 2TB drives you get 4TB of really redundant storage (2 drives data, one parity, one hotspare) it also double as a media server
Advice for Google owning your stuff.
It its true that the basic free usage of Google Apps "terms of service" state that they do own anything you store. I would recommend that you don't store your "bread and butter", we are all musicians, so don't store your original work there, But I'm not worried about a picture of my dog, if they make money off it good for them, because I never will. I also believe it is possible to pay for Google Apps in which you would have a different terms of service
Sorry for the rant, might be because I just had this debate with a friend.